Socialism or your money back

A few items from the above-named blog:

China’s ghost cities and the biggest property bubble of all time

A couple of months ago, a lot of people were passing around the news about China’s plan to create a megacity that would be home to 42 million people, the so-called “Turn the Pearl Delta Into One” idea. The reporting was generally favorable, painting a picture of economic growth and opportunity — the narrative of a prosperous China, with a growing middle class, that has become commonplace in recent years.

Unfortunately, the view of China’s urban planning strategies from the ground is less shiny. A riveting report from Dateline, an Australian TV show, reveals a disturbing pattern of development for development’s sake — the construction of gigantic infrastructure projects with no regard for human needs. (Hat tip to WalkableDFW.)

Take the New South China Mall, in Dongguan. The Dateline crew took a tour of the place, which has been 99 percent vacant since it opened in 2005, and the result is one of the most depressing things I have ever watched. Six years after its creation, what is touted as the largest mall in the world sits almost empty. One of the very few stores that’s in business is a toy shop, where the wistful owner spends his days dusting children’s bikes that no child will ever ride. He is lucky if he makes one sale a day. [READ THE REST]

Doom and gloomier

British families are on average £910 worse off than they were two years ago. Rising food, clothing and energy prices mean the average British family will have £910 less to spend this year than they did in 2009.The squeeze – which is considered the worst in peacetime for 90 years – is set to continue with a two per cent fall in household disposable income this year. The fall in disposable income is comparable with the savage post-World War One recession which lasted between 1919 and 1921, as a result of a collapse in manufacturing and international trade.The findings also show the fall in household disposable income is sharper than in the 1930s depression.

The Centre for Economics and Business Research forecasts inflation will average 3.9pc in 2011. At the same time, salaries will rise just 1.9pc as unemployment remains high and the public sector makes cut-backs.

Employment lawyers have predicted that older workers and pregnant women will be hit by a fresh wave of job cuts. Paul Griffin, head of employment at DBS Law, said: “The growth of discrimination claims from older workers and pregnant women suggests that employers are now targeting their more expensive staff, despite them being in protected groups. Obviously mistakes are being made in companies as accounts departments win out against human resources.”

Robert H. Frank, an economics professor at the Johnson Graduate School of Management at Cornell University, invented the toil index, a measure of how many hours the median American must work to pay for an average family home in a school district of average quality.
“During the immediate postwar decades the toil burden for meeting the rent of that median-price home actually declined slightly, from 42.5 hours a month in 1950 to 41.5 in 1970, according to my calculations.… By 2000, the median worker had to work 67.4 hours a month to put his or her family into the median home. “

The Libyan weapons shop-window

To take out Moammar Gadhafi’s air defenses, Western powers such as France and Italy are using the very aircraft and weapons that only months ago they were showing off to the Libyan leader. Times change, allegiances shift, but weapons companies will always find takers for their goods. The Libyan no-fly zone has become a prime showcase for potential weapons customers, underlining the power of western combat jets and smart bombs, or reminding potential buyers of the defensive systems needed to repel them.

Almost every modern conflict from the Spanish Civil War to Kosovo has served as a test of air power. But the Libyan operation coincides with a new arms race — a surge of demand in the $60 billion a year global fighter market and the arrival of a new generation of equipment in the air and at sea. For the countries and companies behind those planes and weapons, there’s no better sales tool than real combat. For air forces facing cuts, it is a strike for the value of air power itself.

“As soon as an aircraft or weapon is used on operational deployment, that instantly becomes a major marketing ploy; it becomes ‘proven in combat’,” says a former Defense export official with a NATO country. To convince potential buyers, Defense equipment needs to be tested and survive what marketers call a “hot war.” A ‘hot war’ gives arms buyers a chance to cut through marketing jargon and check claims are justified. “Everyone is looking at Libya. It is definitely a showcase,” one western Defense company official told Reuters[…]

The rewards are huge. India, Brazil, Denmark, Greece, Saudi Arabia, UAE, Oman and Kuwait are among a growing list of countries shopping for one or more of the fighters flying sorties over Libya. The deal of the moment: India’s plan to buy 126 fighter jets, an order which should be worth an estimated $10 billion. Reliability, say industry experts, is likely to be the key to winning the exports. Four of the six companies in the running to sell New Delhi planes — Dassault’s Rafale, the Eurofighter Typhoon, Lockheed Martin’s F-16 and Boeing’s F/A-18 — have already helped enforce the no-fly zone over Libya. A fifth contender, the Saab Gripen, arrived in Sicily at the weekend, ready to take part in the first air combat action by the Swedish air force in decades.[…]

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